Elements of a Real Estate Purchase Contract

Well-drafted real estate purchase contracts in California should clearly delineate the terms of the deal – parties, price, escrow, closing date, time for inspections, etc… While it is not required that a real estate attorney look over your contract before closing, it is generally a wise idea. In some cases, the contracts do not contain all the necessary terms, or they contain language more favorable to one party. It may or may not be possible to claim that the contract is unenforceable once both parties have signed.

Indeed, in a 2008 Supreme Court decision, the court clarified that the only elements necessary for enforcing a real estate contract are the seller, the buyer, the price to be paid, the time and manner of payment, and the property to be transferred. If the case goes to court, the court can fill in based on what is usual and customary. The court also noted that if an essential element is reserved for the future agreement of both parties, there is no legal obligation until such future agreement.

When your real estate contract does not cover all the details of the transaction, customary practices will fill in the rest, such as those relating to the opening of an escrow, title insurance policies, taxes, and the like.

In order to avoid becoming involved in a real estate transaction dispute, make sure that your paperwork has been reviewed by a real estate attorney who is experienced in handling the purchase and sale of real property. Ensure that your contract clearly lists all the necessary elements of the transaction. For more information on how to draft a airtight contract, or to have experienced real estate attorneys review your agreement, contact the Los Angeles lawyers at Hart, Watters & Carter today.

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